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Facing bankruptcy, FTX.US seems to have stopped withdrawals on ERC-20 tokens, according to blockchain data. 

As of writing, the wallet address associated with FTX.US had not processed any outgoing transactions in more than an hour. That is despite the notice on the exchange’s website that currently says that “trading may be halted on FTX.US in a few days. Please close down any positions you want to close down. Withdrawals are and will remain open.” Trading hasn’t stopped. 

Subject to U.S. law, FTX.US was largely presented as the branch of the company with the most stringent requirements on holding customer deposits. Former CEO Sam Bankman-Fried tweeted three days ago that withdrawals on the exchange “are and have been live, is fully backed 1:1, and operating normally.”

The exchange filed for bankruptcy earlier today, despite Bankman-Fried’s assurances yesterday that he was trying to save the company. A lockup on U.S. customer funds would be yet more bad news for a company in freefall, and it could, moreover, add to the roster of offenses drawing the ire of U.S. regulators. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

FTX Ventures and Alameda Research have invested in more than 250 crypto industry startups, according to data collected by The Block Research.

The investments cut across a variety of verticals, including decentralized finance, trading and web3. 

Chart by The Block Research

As noted by The Block Research’s Edvinas Rupkus, the first two quarters of 2022 were the most active in terms of venture activity. 

More than 100 corporate entities affiliated with FTX, including Alameda Research and FTX US, filed for Chapter 11 bankruptcy on Friday.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Sam Bankman-Fried, the former CEO of now-bankrupt FTX and a former billionaire, saw his net worth wiped out over the past 24 hours after it fell $861 million, a decline of 100%, according to Bloomberg’s Billionaires Index.

He’s lost over $16 billion this week, a tremendous fall from grace, and is no longer ranked in Bloomberg’s Billionaires Index. 

The FTX founder said on Twitter today that he’s “really sorry, again,” after the exchange and related companies filed for Chapter 11.

“I was shocked to see things unravel the way they did earlier this week,” he wrote on Twitter.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• November 11, 2022 Alameda files for Chapter 11 Bankruptcy Protection
• Alameda estimates there will be funds left over to distribute to the more than 100,000 unsecured creditors 
• $10 – $50bn estimated assets available for distribution 
• $10 – $50bn estimated liabilities outstanding 
• Led by John J Ray III, experienced restructuring officer and plan administration from the Enron, Overseas Shipholding and Nortel Networks situations 
• Filing comes days after Binance’s proposed rescue falls through
• This is an ongoing series from The Block Research covering Alameda & FTX’s insolvency and bankruptcy proceedings

This research piece is available exclusively to
members of The Block Research.
You can continue reading
this Research content on The Block Research.

Former FTX CEO Sam Bankman-Fried insisted the U.S. arm of his crypto empire was “FINE!” after the company’s utility token collapsed — right up until FTX.US filed for bankruptcy on Friday morning. 

“FTX US USERS ARE FINE!” Bankman-Fried wrote in a series of tweets on Thursday. “FTX US, the US-based exchange that accepts Americans, was not financially impacted by this shitshow.”

A day later, Bankman-Fried resigned his post as CEO, and FTX.US filed for bankruptcy in Delaware. FTX announced it had moved to file for Chapter 11, along with more than 100 of its affiliated corporate entities, including Bankman-Fried’s Alameda Research trading firm. 

The shocking collapse of the crypto exchange began last weekend when rival exchange Binance announced it would sell a large position of FTX’s utility token, FTT. Bankman-Fried insisted his company was “fine” on Monday, but by Tuesday the firm was in turmoil. A spokesperson for FTX declined to comment. 

Even as Bankman-Fried acknowledged the international arm of his company was facing trouble, he assured users of FTX.US throughout the week that the entity was not impacted. The former CEO said he was “shocked” by what had happened on Friday, after announcing FTX.US would file for bankruptcy.

“I’m piecing together all of the details, but I was shocked to see things unravel the way they did earlier this week,” Bankman-Fried said on Twitter. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• FTX and Alameda Research, which was absorbed by the former in 2022, were both founded by Sam Bankman-Fried
• DeFi was the main category that the firms invested in, primarily because it offered market-making services for projects’ native tokens
• Solana’s ecosystem projects were the most favored out of all Layer-1 and Layer-2 protocols, passing multichain and Ethereum-supporting projects
• In total, The Block mapped out 255 public investments across 8 categories 

This research piece is available exclusively to
members of The Block Research.
You can continue reading
this Research content on The Block Research.

Coinbase shares soared in the wake of crypto exchange FTX’s bankruptcy filing.

The stock rose as high as 7% from the open, according to TradingView, reaching $55.65. The stock has lost some of those gains, and as of 11:00 a.m ET was trading at around $53, up about 4%.

FTX moved to file for Chapter 11 bankruptcy on Friday, along with more than 100 corporate entities affiliated with the exchange, including Alameda Research and FTX US.

Equities have been buoyant since Thursday’s positive U.S. inflation report. Inflation in October came in below estimates of 8% at 7.7%. The S&P 500 had its biggest one-day rally since 2020, gaining 5.5% yesterday, while the Nasdaq jumped 7.4%.

The S&P 500 opened up 0.46%, and the Nasdaq was up 0.88% on Friday. Cathie Wood’s Ark Invest added over $32 million worth of Coinbase shares to three different ETFs this week. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Sam Bankman-Fried, the founder and former CEO of the FTX crypto exchange that filed for Chapter 11 bankruptcy protection today, said he was “really sorry, again, that we ended up here.”

“I’m piecing together all of the details, but I was shocked to see things unravel the way they did earlier this week,” he wrote in a thread on Twitter. “I will, soon, write up a more complete post on the play by play, but I want to make sure that I get it right when I do.”

The fresh apology came just one day after Bankman-Fried said he had “‘f*cked up” and would do everything possible in an attempt to raise liquidity and save the struggling company.

While he said on Tuesday that the exchange’s U.S. operations had not been impacted by the liquidity crunch, FTX US was included in the slew of bankruptcy filings. 

Collectively, the firms have claimed more than 100,000 creditors and between $10 billion and $50 billion in both assets and liabilities. 

“I’m going to work on giving clarity on where things are in terms of user recovery ASAP,” Bankman-Fried said. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Matrixport, a crypto financial services platform that bills itself as a neo-bank, revealed to clients that two of its products have exposure to FTX. 

Matrixport’s bitcoin fixed income products — including bitcoin fixed income products and smart trend products that use BTC Fixed Income Product as underlying — and the Victoria bitcoin fund products, which have a total of 79 users, have incurred losses as a result, it said in a letter to clients.

The letter stressed that the firm’s other products are segregated, so that “a single impacted product will not affect the other products.”

Matrixport has reached out to the 79 affected clients.

FTX has since filed for Chapter 11 bankruptcy. FTX  is seeking bankruptcy protection in Delaware. In addition to FTX Trading, more than 100 corporate entities affiliated with FTX, including Alameda Research, are also filing for bankruptcy.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto prices sank on the news that FTX and more than 100 corporate entities affiliated with the firm are filing for bankruptcy. 

Bitcoin dropped 5.2% at $16,551, while ether crashed 6.5% to $1,215.

BTCUSD chart by TradingView

Rumors of FTX’s insolvency had been swirling in the lead-up to the filing. Former Head of Institutional Sales Zane Tacket revealed via Twitter that the firm had $8.8 billion in liabilities, just $900 million in liquid assets, and $5.2 billion in less liquid or illiquid assets. 

The exchange was also seeking up to $9 billion in funding to plug its financial hole, according to a Reuters report.

Prices had been lifted by a positive U.S. inflation data report on Thursday. Crypto prices immediately jumped following the news, as did equities. Bitcoin traded at $16,420 before the release, jumping to $17,540 shortly after, according to data via Coinbase. These gains have now been erased. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.